The ATO has announced a temporary simplified method for salary and wage earners to claim deductions as a result of working from home due to the Coronavirus pandemic.
Individual clients will be allowed to claim a deduction for home running expenses incurred during the period 1st of March to 30th of June 2020.
Based on a rate of 80 cents each hour you work from home, which includes the following:
• Electricity expenses associated with heating, cooling and lighting the area at home which is being used for work
• Cleaning costs for a dedicated work area
• Phone and internet expenses
• Computer consumables (e.g. printer paper and ink) and stationery
• Depreciation of home office furniture and furnishings (e.g. an office desk and a chair)
• Depreciation of home office equipment (e.g. a computer and a printer)
This means that, under the 80 cents per hour method, separate claims cannot be made for any of the
above running expenses (including depreciation of work-related furniture and equipment).
When we prepare your 2020 income tax return, we will advise you which method is suited to your circumstances to benefit you.
If you want to claim a portion of your land based items such as mortgage interest, rates and building items such as painting and carpets - you may then incur capital gains tax implications when you sell your home.
We strongly recommend that you use our personalised recordkeeping App (MyAccountants - Mirandas via your App Store) to record all of your home office working hours and your expenses listed above.
Stay safe and we look forward to assisting you with your 2020 income tax preparation.
Remember all our latest updates and new tax reforms are on our Facebook page and blog section of our website.